Tax Reduction Act of 1975

Summary

Tax Reduction Act - Title I: Refund of 1974 Individual Income Taxes - States that each individual shall be treated as having made a payment against his or her income tax under the Internal Revenue Code for his first taxable year beginning in 1974 of 10 percent of the amount of liability for tax for such taxable year up to $300 ($150 in the case of a married individual filing a separate return). Provides that such amount shall be reduced by 3 percent of the taxpayer's adjusted gross income in excess of $20,000 ($10,000 in the case of a married individual filing separately). Title II; Reductions In Individual Income Taxes - States that the low income allowance is (1) $2500 in the case of a joint return or a surviving spouse; (2) $1900 in the case of an unmarried individual not a surviving spouse; and (3) $1250 in the case of a married individual filing separately. Changes the filing requirements to reflect this increase in the low-income allowance. States that the percentage standard deduction is an amount equal to 16 percent of adjusted gross income but not to exceed: (1) $3,000 in the case of a joint return, or a surviving spouse; (2) $2,500 in the case of an individual who is not married and who is not a surviving spouse; or (3) $1,500 in the case of a married individual filing a separate return. Allows a credit against the income tax of 5 percent of the taxpayer's adjusted earned income for the taxable year. Defines the term "adjusted earned income". Title III: Certain Changes In Corporate Taxes - Increases the investment credit from 7 to 10 percent, except for construction completed by a taxpayer before January 22, 1975. Increases the coporate surtax exemption from $25,000 to $35,000. Provides that distributions in lieu of money and disproportionate distributions of stock by a regulated public utility reinvested pursuant to a qualified dividend reinvestment plan (as defined by this Act) shall be excludible from gross income by the receiving shareholders.

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Documents

3 official files

• Public Law (PDF)

  Public Law · EN · 29 March 1975

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• Conference report filed in House

  summary · EN · 26 March 1975

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• Introduced in House

  summary · EN · 28 January 1975

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